2012's Top Turnaround Housing Markets: Las Vegas and Seattle

Trulia's Chief Economist discusses the latest findings from the Trulia Price Monitor and the Trulia Rent Monitor. Nationally, asking home prices are up 5.1% year-over-year, while rents rose 5.2%. Locally, Phoenix, Las Vegas, and San Jose posted the largest year-over-year price gains in December.

The Trulia Price Monitor and the Trulia Rent Monitor are the earliest leading indicators of how asking prices and rents are trending nationally and locally. They adjust for the changing mix of listed homes and therefore show what’s really happening to asking prices and rents. Because asking prices lead sales prices by approximately two or more months, the Monitors reveal trends before other price indexes do. With that, here’s the scoop on where prices and rents are headed.

Asking Prices Rise 5.1% Nationally Year-Over-Year, Up in 82 of the 100 Largest Metros

In December 2012, Phoenix had the nation’s largest year-over-year price increase at 26.0%. But Las Vegas and Seattle had double-digit price gains in 2012 after double-digit declines in 2011, making them the top turnaround housing markets of the year. Phoenix had the third-largest improvement in 2012 relative to 2011. All but one of the top 10 turnaround metros were in the West and Southwest, including four in California: Oakland, San Jose, Sacramento, and Fresno. Atlanta was the only market east of the Rockies to make the list.

NOTE: Among 100 largest U.S. metros. The third column of figures equals the first column minus the second column. Click here to download a PDF of price and rent trends for all 100 metros.

2012 was a huge turnaround year for most local markets, not just the 10 on our list. Whereas 82 of 100 metros had price increases in 2012, only 12 did in 2011. Furthermore: in 2012, 16 metros had price increases of more than 10%, compared with just two in 2011. And only five of the 100 largest metros had smaller price increases (or bigger declines) in 2012 than in 2011: Miami, Fort Lauderdale, and Cape Coral-Fort Myers, FL, plus Greenville, SC and Albany, NY.

2012

2011

National price change,year-over-year, December

+5.1%

-4.3%

# of 100 largest metroswith price increases

82

12

# of 100 largest metros withprice increases more than 10%

16

2

# of 100 largest metros withprice declines more than 10%

0

6

Rents Up 5.2%, But Prices Rising Faster than Rents in 17 of 25 Largest Rental Markets

Nationally, rents rose 5.2% year-over-year, still slightly ahead of the national price gain of 5.1%. In Houston, Chicago, Philadelphia, and Baltimore, rents are rising much faster than home prices. But in most large rental markets, prices are rising faster than rents. The gap is largest in "rebound" markets--those which are bouncing back from steep price declines after the bubble burst--specifically in Phoenix, Las Vegas, Riverside-San Bernardino, CA, and Sacramento, where home prices rose more than rents by at least 7 percentage points.

NOTE: Largest 25 rental markets, ranked by change in rents. Click here to download a PDF of price and rent trends for all 100 metros.

The next Trulia Price Monitor and Trulia Rent Monitor will be released on Tuesday, February 5, at 10 AM ET.

How did we put this report together? To recap the methodology, the Trulia Price Monitor and the Trulia Rent Monitor track asking home prices and rents on a monthly basis, adjusting for the changing composition of listed homes, including foreclosures provided by RealtyTrac. The Trulia Price Monitor also accounts for the regular seasonal fluctuations in asking prices in order to reveal the underlying trend in prices. The Monitors can detect price movements at least three months before the major sales-price indexes do. Our FAQs provide all the technical details.